Japanese Prime Minister's advisor: No need to appoint more inflationists to fill seats on the Bank of Japan's board.

Honda Eikuro, economic adviser to Japanese Prime Minister Sanae Takaichi, said that as Japan's economy has emerged from deflation, the government may not necessarily need to choose inflationists to fill the upcoming vacancies on the central bank's board. Honda Eikuro, who also served as an economic aide to former Prime Minister Shinzo Abe, stated that inflation and rising government bond yields indicate that the economy is returning to normalcy, and that the Bank of Japan has room to raise interest rates this year. "Japan has already overcome deflation, and the current challenge is to formulate a growth strategy. This is completely different from the period when Japan was deeply mired in deflation during the Abe era. I believe Takaichi Sanae understands this," Honda Eikuro said in an interview on Thursday. When asked who should be appointed as the new director of the Bank of Japan, he said, "I do not think it is necessary to appoint those who advocate strong monetary easing and inflation." As someone who has long assisted both Abe and Takaichi, Honda Eikuro's statement suggests that this government may not block the Bank of Japan from gradually raising interest rates. It is believed that this move is necessary to curb the unwelcome depreciation of the yen.